I Need Motivational Help!
November 10, 2011 5:00 PM Subscribe
I've asked here about HOW to budget for a family, but darn it, I can't bring myself to do it! I need help. (Perhaps psychological help.)
This may seem like a silly AskMe, but this is a genuine tough-hurdle for us. We're stuck in a worry/avoidance/worry cycle that needs to be ended.
My wife and I are NOT numbers people and have an aversion to this kind of stuff. We've been making ends meet over the years but it's time for a big change. We're finally in a situation in which having a budget wouldn't just be about saving our asses, it would actually be a huge improvement in quality of life.
Do you have any suggestions or tales of being saved by a budget? Should we seek some kind of counseling? Any ideas will be greatly appreciated.
Many thanks in advance!
This may seem like a silly AskMe, but this is a genuine tough-hurdle for us. We're stuck in a worry/avoidance/worry cycle that needs to be ended.
My wife and I are NOT numbers people and have an aversion to this kind of stuff. We've been making ends meet over the years but it's time for a big change. We're finally in a situation in which having a budget wouldn't just be about saving our asses, it would actually be a huge improvement in quality of life.
Do you have any suggestions or tales of being saved by a budget? Should we seek some kind of counseling? Any ideas will be greatly appreciated.
Many thanks in advance!
I can assure you that avoidance must be, and can be, overcome!
Constantly think of how much better things are/will be without the avoidance.
And a really big change would be to cash your paychecks (figuratively speaking if you get direct deposit), get home securely, and get out the envelopes! Pay bills with money orders; consider it a learning fee. Try it for a month. You literally will see where the money goes.
A less dramatic change would be the 60-40 budget. It's only 6 spending categories, thus simple. You don't get get caught up in the system.
posted by jgirl at 5:16 PM on November 10, 2011
Constantly think of how much better things are/will be without the avoidance.
And a really big change would be to cash your paychecks (figuratively speaking if you get direct deposit), get home securely, and get out the envelopes! Pay bills with money orders; consider it a learning fee. Try it for a month. You literally will see where the money goes.
A less dramatic change would be the 60-40 budget. It's only 6 spending categories, thus simple. You don't get get caught up in the system.
posted by jgirl at 5:16 PM on November 10, 2011
Can you explain where you are in the process exactly? Have you made any progress at all? Or are you still constantly surprised when you run out of money / have extra left over for savings at the end of the month?
If you really are just starting out, you need to take several months of credit card and bank statements and figure out your historical spending in all the big areas (rent, car, groceries, insurance, phones, utilities, dining out / entertainment, etc.) - preferably a year so you can see how things vary through the seasons. It will suck, but make yourself do it. A little at a time - make a big Excel sheet to save your work so you can do a meaningful amount every time you have a chance and it will add up.
Then, going forward, sign up for Mint or something to track all your credit cards and bank accounts (you do at least have a checking account, right?), and then check it every damn day. No surprises. Know when you spend, over and over, and eventually you will know what to expect and when.
When you get the excel sheet done, or at least done for the last say 3 months, you can look at it all together and come up with some predictions about what you will spend the next month. Then as the month rolls on, keep an eye on the online account monitor and see if your targets are at all right, and if not, re-analyze that category to see what's going on.
Is this at all what you need or are you in a totally different place?
posted by rkent at 5:24 PM on November 10, 2011
If you really are just starting out, you need to take several months of credit card and bank statements and figure out your historical spending in all the big areas (rent, car, groceries, insurance, phones, utilities, dining out / entertainment, etc.) - preferably a year so you can see how things vary through the seasons. It will suck, but make yourself do it. A little at a time - make a big Excel sheet to save your work so you can do a meaningful amount every time you have a chance and it will add up.
Then, going forward, sign up for Mint or something to track all your credit cards and bank accounts (you do at least have a checking account, right?), and then check it every damn day. No surprises. Know when you spend, over and over, and eventually you will know what to expect and when.
When you get the excel sheet done, or at least done for the last say 3 months, you can look at it all together and come up with some predictions about what you will spend the next month. Then as the month rolls on, keep an eye on the online account monitor and see if your targets are at all right, and if not, re-analyze that category to see what's going on.
Is this at all what you need or are you in a totally different place?
posted by rkent at 5:24 PM on November 10, 2011
I've started budgeting for the first time this year. I used to not bother because in my early twenties I had so little money that my income basically covered rent and utilities and left zero over for any discretionary spending, so budgeting would make no difference. Then more recently I had plenty of savings in the bank and as long as I could see them increasing over the months, I knew I was spending under my income, so I didn't care about the details.
Now that I have a mortgage (where the payments are monthly and my income is fortnightly, and interest makes things more complicated), it isn't so intuitively obvious to me that my spending is appropriate, so I've had to budget and compare my actual expenses to my targets to reassure myself I am on track.
I'm using Yodlee, so the actual effort to budget is nearly zero. I let it run for a few months, then looked at what my average expenses were in each category, calculated the annual ones that hadn't come in yet, and set targets based on those. Now I just check in every fortnight right after my salary is paid, and make sure that my expenditure over the past fortnight (and on average over hte past months) didn't exceed my targets.
I have found this ENORMOUSLY reassuring, and I have allowed myself to splurge a little on some nice things that I would have been too anxious to buy if I wasn't 100% sure everything else was already covered. Also, every time I check in I recalculate how long my mortgage will take to pay off assuming my current rate of savings continues, and that makes me happy too, because it is a nice short time.
posted by lollusc at 5:27 PM on November 10, 2011 [1 favorite]
Now that I have a mortgage (where the payments are monthly and my income is fortnightly, and interest makes things more complicated), it isn't so intuitively obvious to me that my spending is appropriate, so I've had to budget and compare my actual expenses to my targets to reassure myself I am on track.
I'm using Yodlee, so the actual effort to budget is nearly zero. I let it run for a few months, then looked at what my average expenses were in each category, calculated the annual ones that hadn't come in yet, and set targets based on those. Now I just check in every fortnight right after my salary is paid, and make sure that my expenditure over the past fortnight (and on average over hte past months) didn't exceed my targets.
I have found this ENORMOUSLY reassuring, and I have allowed myself to splurge a little on some nice things that I would have been too anxious to buy if I wasn't 100% sure everything else was already covered. Also, every time I check in I recalculate how long my mortgage will take to pay off assuming my current rate of savings continues, and that makes me happy too, because it is a nice short time.
posted by lollusc at 5:27 PM on November 10, 2011 [1 favorite]
There's a very useful sticky thread on the somethingawful business/finance/careers forum: The Newbie Personal Finance thread which has many budgeting suggestions and lots of things related to money/credit cards/loans etc. (mainly USA orientated)
nb. somethingawful posters don't hold back on bad language/jokes in poor taste.
posted by selton at 5:30 PM on November 10, 2011
nb. somethingawful posters don't hold back on bad language/jokes in poor taste.
posted by selton at 5:30 PM on November 10, 2011
i used to be like you with that worry/avoidance/worry cycle. until i ended up in very severe debt and i was quite literally forced to put together a budget in order to effectively use the aid i needed to get myself out of debt. it really woke up me up. now i'm religious about balancing my budget. i use my bank's online budget/financial reports/bill pay application to track my income and expenses and the budgeting gets done pretty much automatically. i check it every single night. like headnsouth said, it's addictive. but it's also helped me immensely in seeing exactly where my money goes, as well as helps me to identify areas where i can cut back on spending, or revisit my budget goals. the application also presents everything visually thru charts as well, which is another great way to really see where all the money is going.
furthermore, in the past, i was never able to save money bc i was just spending blindly, but since i started tracking my budget, i've also been able to save money by transferring what i had left over every week into a connected savings account rather than leaving it in my checking account where it might get spent on random things. watching that savings grow is another great incentive for me to keep to my budget. before i started tracking my budget, i'd always thought that having to do so would stress me out even more but in actuality, it's really reassuring i know how much money available to me every day, as well as heightening my awareness of what i'm spending with every transaction i make.
posted by violetk at 5:33 PM on November 10, 2011 [1 favorite]
furthermore, in the past, i was never able to save money bc i was just spending blindly, but since i started tracking my budget, i've also been able to save money by transferring what i had left over every week into a connected savings account rather than leaving it in my checking account where it might get spent on random things. watching that savings grow is another great incentive for me to keep to my budget. before i started tracking my budget, i'd always thought that having to do so would stress me out even more but in actuality, it's really reassuring i know how much money available to me every day, as well as heightening my awareness of what i'm spending with every transaction i make.
posted by violetk at 5:33 PM on November 10, 2011 [1 favorite]
Somebody has to become un-averted to this stuff. Either one of you has to agree to take this on, or you need to pay someone to do it for you. Honestly, once you figure out the breakdown and put it in a spreadsheet, maintaining the budget itself is no big deal. (Living to the budget may be harder for you, in which case it's either bootstraps or counseling.)
I think the #1 problem people have that causes budget anxiety is a habit of not wanting to know, as if the news is always bad. If you've ever been depressed and/or real bad broke, you probably stuck your head in the sand and left it there.
But it sounds like y'all aren't on the verge of homelessness or anything, and so there's no horrible shocks in the data, I promise. I mean, you may discover that you are overpaying for car insurance or should start buying X in bulk instead of one at a time, but there's likely nothing in there that you don't already pretty much know about.
At the end of the day, data is power. You will have more money just by having a budget, it is practically guaranteed.
Our first budget was a sad little thing. We used it to figure out which utility bill we had to short each month to keep everything turned on. We just used the budget last month to figure out that we could/should pay off our cars early.
It's not that hard. You start by making a list of everything you have to pay. Then you add things you need to buy (groceries, gas, whatever). Then you look at how much is left and decide how much is discretionary and how much gets saved. From there you can tweak it all you want, but those basic items make up a basic budget. Once you've done those things, maintenance is 20 minutes a month.
Even if the budget says you're broke, at least you know for sure. That's preferable to walking around wondering if you're broke, if your debit card's going to work at the gas station, if the cable's going to get shut off today. At least you'll know what day the cable's going to get shut off!
(I have not read it yet, but I've heard some summary of Chris Hardwick's new geek-productivity book The Nerdist Way, which includes a chapter on getting a handle on your finances when you've been studiously ignoring them for as long as possible. And Chris is funny so it's not all dire doom and gloom you suck kind of talk.)
posted by Lyn Never at 5:37 PM on November 10, 2011
I think the #1 problem people have that causes budget anxiety is a habit of not wanting to know, as if the news is always bad. If you've ever been depressed and/or real bad broke, you probably stuck your head in the sand and left it there.
But it sounds like y'all aren't on the verge of homelessness or anything, and so there's no horrible shocks in the data, I promise. I mean, you may discover that you are overpaying for car insurance or should start buying X in bulk instead of one at a time, but there's likely nothing in there that you don't already pretty much know about.
At the end of the day, data is power. You will have more money just by having a budget, it is practically guaranteed.
Our first budget was a sad little thing. We used it to figure out which utility bill we had to short each month to keep everything turned on. We just used the budget last month to figure out that we could/should pay off our cars early.
It's not that hard. You start by making a list of everything you have to pay. Then you add things you need to buy (groceries, gas, whatever). Then you look at how much is left and decide how much is discretionary and how much gets saved. From there you can tweak it all you want, but those basic items make up a basic budget. Once you've done those things, maintenance is 20 minutes a month.
Even if the budget says you're broke, at least you know for sure. That's preferable to walking around wondering if you're broke, if your debit card's going to work at the gas station, if the cable's going to get shut off today. At least you'll know what day the cable's going to get shut off!
(I have not read it yet, but I've heard some summary of Chris Hardwick's new geek-productivity book The Nerdist Way, which includes a chapter on getting a handle on your finances when you've been studiously ignoring them for as long as possible. And Chris is funny so it's not all dire doom and gloom you suck kind of talk.)
posted by Lyn Never at 5:37 PM on November 10, 2011
Two things that have saved my ass money-wise were:
1- Setting up the bills to all be due at roughly the same time every month. Therefore, I only have to pay bills 12 times a year. Made a HUGE difference from having to try and figure out which bills to pay on the 1st and which to pay on the 15th.
(Along with that was also not touching the checking account in the interim. I pulled out my pocket cash for the month after paying my bills. Everything else goes through the credit cards. This requires self control, but way simplifies paying bills.)
2- Online banking. The kind where you pay your bills out of your bank's website. Way easier than writing checks or trying to set up bill-pay on all my creditors' different websites.
OK, 3- Have different credit cards for different purposes. I have one card for gas and car, one card for bills that need to get auto-paid (gym, internet, etc.), and another for everything else.
After that, just start with tracking spending. What works for me is to have a spreadsheet with individual sheets for each month. My different bills are listed vertically below that. I have one column for what the minimum payment is, and one column for what I will pay. Above that column, I have my checking account starting balance, and below it I have the balance minus all the bills I paid. That allows me to see what I'm paying for each thing every month, and allocate money where it needs to go.
Once I got comfortable with that, I added in more columns for the different bills that tracks what the balances on my various loans and savings accounts are, and I have some formulas that calculate what my total debt load is. If it is going down month to month, I am winning. If it doesn't, I'm not.
Once I had all that working and was comfortable with it, I started looking at the individual things, and where I could adjust my spending. You can add formulas to show you what the percentages of each spending category is.
Point is, start small. Set up a way to track spending that works for you, and as you get comfortable with each step, add more detail. It takes a surprisingly small amount of time to do each month when you set aside some time to do it. You can't change your spending until you track it somehow.
posted by gjc at 5:46 PM on November 10, 2011 [1 favorite]
1- Setting up the bills to all be due at roughly the same time every month. Therefore, I only have to pay bills 12 times a year. Made a HUGE difference from having to try and figure out which bills to pay on the 1st and which to pay on the 15th.
(Along with that was also not touching the checking account in the interim. I pulled out my pocket cash for the month after paying my bills. Everything else goes through the credit cards. This requires self control, but way simplifies paying bills.)
2- Online banking. The kind where you pay your bills out of your bank's website. Way easier than writing checks or trying to set up bill-pay on all my creditors' different websites.
OK, 3- Have different credit cards for different purposes. I have one card for gas and car, one card for bills that need to get auto-paid (gym, internet, etc.), and another for everything else.
After that, just start with tracking spending. What works for me is to have a spreadsheet with individual sheets for each month. My different bills are listed vertically below that. I have one column for what the minimum payment is, and one column for what I will pay. Above that column, I have my checking account starting balance, and below it I have the balance minus all the bills I paid. That allows me to see what I'm paying for each thing every month, and allocate money where it needs to go.
Once I got comfortable with that, I added in more columns for the different bills that tracks what the balances on my various loans and savings accounts are, and I have some formulas that calculate what my total debt load is. If it is going down month to month, I am winning. If it doesn't, I'm not.
Once I had all that working and was comfortable with it, I started looking at the individual things, and where I could adjust my spending. You can add formulas to show you what the percentages of each spending category is.
Point is, start small. Set up a way to track spending that works for you, and as you get comfortable with each step, add more detail. It takes a surprisingly small amount of time to do each month when you set aside some time to do it. You can't change your spending until you track it somehow.
posted by gjc at 5:46 PM on November 10, 2011 [1 favorite]
I've found the most useful thing to think about in terms of budgeting is setting goals. Do you want to spend less? Do you want to earn more? What is the problem you are trying to solve? A lot of people think "gaaaaahhhh money!!" and can't get beyond the feeling that the problem is large and unknowable. But really, it's one of the most knowable things that exists. It's math. And only math. There may be other drama wrapped up in it [do you quit buying cigarettes to make ends meet? what about the monthly beer with the boys? no more haircuts?] but that's actually different. In your dream world you want to do a few things
1. Know all the bills - open the mail, note what you owe, for god's sake toss out all the other envelopes and paper you won't use. Get a clipboard or something.
2. Lump categories - vital stuff [we will not be able to live without], important stuff [we'd really like this], flexible stuff [we'd like but we can adjust], fluff [don't care, it can go] - and be honest with yourself, if internet is vital, that's fine. Try to get loose amounts of what sort of money is in each "lump" Talk to your partner about their important vs vital vs flexible
3. Look at bills for a few months - using Mint or some other nice 2.0 system makes this easy and I'd suggest it.
4. See what's what and make a plan for a month or two - a budget can be a suggestion and you can adjust it, but try to stick to it. If sticking to it is a problem, then seriously go the "cash the paycheck, put money in envelopes, when it's gone you eat beans for the rest of the month" route
Other things...
- try to automate paying as many bills as you can so that you have a record of what you paid and so it just gets done. Obviously don't do this if you are bouncing checks every month, but otherwise: do it
- try to space out regular things that cost money so you do them less frequently [six haircuts a year instead of ten?]
- BE HONEST - this is not the time to try to be all not like yourself so you can do well, you wan tto be realistic and have something everyone can live with. And if you're "splurging" sorts of people you need to find a way to build that in, not go without
And it may be that you just don't like having to be this tight with money and then you can decide that you just need to bring more in. Sell some stuff, take a side job, put the kids to work, whatever. Your only option isn't budgeting, but it's usually the most realistic for most people because time is another thing that you budget. There are a lot of great other AskMes about budgeting, but the plan is to spend a chunk of a weekend, get a plan moving and then doing 15 minutes a day or a few hours on the weekend and have it just run itself. You can totally do it, you don't have to have a spreadsheet, you can still spend money on weed or whatever. Good luck.
posted by jessamyn at 5:51 PM on November 10, 2011 [1 favorite]
1. Know all the bills - open the mail, note what you owe, for god's sake toss out all the other envelopes and paper you won't use. Get a clipboard or something.
2. Lump categories - vital stuff [we will not be able to live without], important stuff [we'd really like this], flexible stuff [we'd like but we can adjust], fluff [don't care, it can go] - and be honest with yourself, if internet is vital, that's fine. Try to get loose amounts of what sort of money is in each "lump" Talk to your partner about their important vs vital vs flexible
3. Look at bills for a few months - using Mint or some other nice 2.0 system makes this easy and I'd suggest it.
4. See what's what and make a plan for a month or two - a budget can be a suggestion and you can adjust it, but try to stick to it. If sticking to it is a problem, then seriously go the "cash the paycheck, put money in envelopes, when it's gone you eat beans for the rest of the month" route
Other things...
- try to automate paying as many bills as you can so that you have a record of what you paid and so it just gets done. Obviously don't do this if you are bouncing checks every month, but otherwise: do it
- try to space out regular things that cost money so you do them less frequently [six haircuts a year instead of ten?]
- BE HONEST - this is not the time to try to be all not like yourself so you can do well, you wan tto be realistic and have something everyone can live with. And if you're "splurging" sorts of people you need to find a way to build that in, not go without
And it may be that you just don't like having to be this tight with money and then you can decide that you just need to bring more in. Sell some stuff, take a side job, put the kids to work, whatever. Your only option isn't budgeting, but it's usually the most realistic for most people because time is another thing that you budget. There are a lot of great other AskMes about budgeting, but the plan is to spend a chunk of a weekend, get a plan moving and then doing 15 minutes a day or a few hours on the weekend and have it just run itself. You can totally do it, you don't have to have a spreadsheet, you can still spend money on weed or whatever. Good luck.
posted by jessamyn at 5:51 PM on November 10, 2011 [1 favorite]
Response by poster: This was kind of an embarrassing thing to post, but you folks have made me feel MUCH better about it and much more equipped to do what I have to do.
These insights and suggestions are just amazing and I feel GREAT about it now. I can't thank you enough!
posted by snsranch at 7:15 PM on November 10, 2011
These insights and suggestions are just amazing and I feel GREAT about it now. I can't thank you enough!
posted by snsranch at 7:15 PM on November 10, 2011
One tip that will help is become a regular reader of the blog "The Simple Dollar". Trent is awesome, he churns out two articles every day day in day out. It is a community of people working to put money in its proper place. Great blog! Financial freedom is an amazing achievement.
posted by jcworth at 7:27 PM on November 10, 2011
posted by jcworth at 7:27 PM on November 10, 2011
Operate with cash, not a debit or credit card. Once I started doing this, I stopped spending because it meant spending actual money, not just the concept of money, so I really had to rationalize the expenditure. Very helpful little speedbump for me.
posted by ThatCanadianGirl at 7:32 PM on November 10, 2011 [2 favorites]
posted by ThatCanadianGirl at 7:32 PM on November 10, 2011 [2 favorites]
My advice is to not be afraid to adapt systems to your own life. People get very passionate about the best way to control your money and the best way to categorize expenses and the best way to budget. (See every single "we just moved in together/got married, how should we handle the bills/budget" question here on AskMe.) Don't force yourself to give up practices that really do work for you just to be in step with a system. A non-intuitive or overly cumbersome system isn't going to be "best" for you.
For instance, I found that I needed to track expenses meticulously for about a year. It was a good sort of chore -- concrete and unambiguous and Making Progress. THEN, I felt comfortable enough with our spending ranges to set a realistic budget. Once I had enough data to show that I'd figured out something that worked for us, I didn't need to collect and log receipts anymore. This has to do with how my SO and I feel about money, and how we're comfortable paying for things and sharing expenses.
posted by desuetude at 8:47 PM on November 10, 2011 [1 favorite]
For instance, I found that I needed to track expenses meticulously for about a year. It was a good sort of chore -- concrete and unambiguous and Making Progress. THEN, I felt comfortable enough with our spending ranges to set a realistic budget. Once I had enough data to show that I'd figured out something that worked for us, I didn't need to collect and log receipts anymore. This has to do with how my SO and I feel about money, and how we're comfortable paying for things and sharing expenses.
posted by desuetude at 8:47 PM on November 10, 2011 [1 favorite]
My own personal trick for avoiding the need to budget has been serving me very well for a long time now. It's based on the idea of a financial cushion - an amount I think of as a loan-to-myself rather than money-I-can-spend.
My earnings are paid automatically into my bank account, and my mortgage payments and as many of my bills as possible are set up as automatic direct debits, as is a weekly $50 deposit into a long-term savings account.
Instead of tracking every tiny thing I spend, I keep the ATM slip from my most recent cash withdrawal in my back pocket and use the balance figure to decide what kinds of things I will allow myself to spend money on.
If the balance is under $1500, I can only pay for the automatic debits, staple groceries, fuel, having the car fixed, medical bills or school necessities for little miss flabdablet.
If it's at least $1500 but under $2000, I can buy any of the above or up to (balance - $1000) worth of clothing, luxury groceries, or pre-made food.
If it's $2000 or over, I can buy up to (balance - $1000) worth of anything I want.
If it's over $2500 then I transfer the excess into long-term savings and try to avoid optional work.
The fact that non-essential spending can't ever drive the balance below $1000 provides the financial cushion that makes budgeting essentially unnecessary.
The only things needed to keep this system working are (a) having slightly more income than will sustain spending on the under-$1500 categories, as evidenced by the balance eventually growing over the first $1500 wall (b) the self-discipline to stick with it and (c) a credit union that makes it easy to set up automatic direct debits and periodical payments.
Ms. flabdablet and I run separate bank accounts. I have no idea how she manages hers. Which of us ends up paying for any item we've both agreed the house needs is a bit random, but generally seems pretty fair to both of us.
Sure beats all that finicking paperwork.
posted by flabdablet at 11:40 PM on November 10, 2011 [2 favorites]
My earnings are paid automatically into my bank account, and my mortgage payments and as many of my bills as possible are set up as automatic direct debits, as is a weekly $50 deposit into a long-term savings account.
Instead of tracking every tiny thing I spend, I keep the ATM slip from my most recent cash withdrawal in my back pocket and use the balance figure to decide what kinds of things I will allow myself to spend money on.
If the balance is under $1500, I can only pay for the automatic debits, staple groceries, fuel, having the car fixed, medical bills or school necessities for little miss flabdablet.
If it's at least $1500 but under $2000, I can buy any of the above or up to (balance - $1000) worth of clothing, luxury groceries, or pre-made food.
If it's $2000 or over, I can buy up to (balance - $1000) worth of anything I want.
If it's over $2500 then I transfer the excess into long-term savings and try to avoid optional work.
The fact that non-essential spending can't ever drive the balance below $1000 provides the financial cushion that makes budgeting essentially unnecessary.
The only things needed to keep this system working are (a) having slightly more income than will sustain spending on the under-$1500 categories, as evidenced by the balance eventually growing over the first $1500 wall (b) the self-discipline to stick with it and (c) a credit union that makes it easy to set up automatic direct debits and periodical payments.
Ms. flabdablet and I run separate bank accounts. I have no idea how she manages hers. Which of us ends up paying for any item we've both agreed the house needs is a bit random, but generally seems pretty fair to both of us.
Sure beats all that finicking paperwork.
posted by flabdablet at 11:40 PM on November 10, 2011 [2 favorites]
Here's our system, which works well for us.
We have a joint account that we use for all the bills, groceries, home improvements and other necessary shared expenses. We know how much these add up to every month, we round it up a bit and each have a standing order that pays the right amount into that account every month right after pay day.
If there's money over in the joint account at the end of a month I move it to a joint savings account that's earmarked for big home improvements like a new kitchen. If the account is in overdraft at the end of the month, no more DIY for us the month after that!
After that I personally have a standing order from my personal account into my pension and my savings (which is earmarked for a new-to-me car in a couple of years when my current car dies). After THAT I spend whatever is left gleefully on anything I like. Mostly at the moment there isn't any left, but that's because I've chosen to pay more into my pension at the moment because yay! low stock market!
posted by emilyw at 3:22 AM on November 11, 2011
We have a joint account that we use for all the bills, groceries, home improvements and other necessary shared expenses. We know how much these add up to every month, we round it up a bit and each have a standing order that pays the right amount into that account every month right after pay day.
If there's money over in the joint account at the end of a month I move it to a joint savings account that's earmarked for big home improvements like a new kitchen. If the account is in overdraft at the end of the month, no more DIY for us the month after that!
After that I personally have a standing order from my personal account into my pension and my savings (which is earmarked for a new-to-me car in a couple of years when my current car dies). After THAT I spend whatever is left gleefully on anything I like. Mostly at the moment there isn't any left, but that's because I've chosen to pay more into my pension at the moment because yay! low stock market!
posted by emilyw at 3:22 AM on November 11, 2011
Not to jump on your previous comment about feeling great, but sometimes just thinking about doing the thing you've been avoiding temporarily satisfies that worry/avoidance/worry cycle and keeps you from actually doing it.
That said, a simple system is going to be easier to stick to. A 33%, 33%, 33% system of fixed, free (including food) and savings works for me. (And conveniently my income is a multiple of 3.) Pick what seems sane to you. You can tweak it later.
Did you go bust for the week? Bummer, you're going to go on Penny Pinching Watch. That means you burrow down into your index card. Write what each expense was for, how much it cost to the cent, and do daily tabulations. Did you still go bust for the week? Uh oh, next week you're going to go psychoanalysis on your self and write down why you purchased each item. Did you spend that extra $50 on X because it was pay day and you were happy? Oh man, you just got introspective.
Once you get your monthly budget in control you can start to look at bigger picture things like investments, retirement, etc. Don't get overwhelmed. At first, all you need to worry about is meeting that number on a card in your wallet.
posted by fontophilic at 7:39 AM on November 11, 2011 [1 favorite]
That said, a simple system is going to be easier to stick to. A 33%, 33%, 33% system of fixed, free (including food) and savings works for me. (And conveniently my income is a multiple of 3.) Pick what seems sane to you. You can tweak it later.
- Start by figuring out how much money comes in.
- Then figure out how much you must spend per month (housing, utilities, insurance, transportation, debt payments).
- Set a goal for savings.
- Then write down the balance. This is the money you can spend this month. Break it into weeks.
- Write this number down on an index card. Keep it in your wallet.
- Write down how much you spend, as you spend it. You can round up or estimate.
Did you go bust for the week? Bummer, you're going to go on Penny Pinching Watch. That means you burrow down into your index card. Write what each expense was for, how much it cost to the cent, and do daily tabulations. Did you still go bust for the week? Uh oh, next week you're going to go psychoanalysis on your self and write down why you purchased each item. Did you spend that extra $50 on X because it was pay day and you were happy? Oh man, you just got introspective.
Once you get your monthly budget in control you can start to look at bigger picture things like investments, retirement, etc. Don't get overwhelmed. At first, all you need to worry about is meeting that number on a card in your wallet.
posted by fontophilic at 7:39 AM on November 11, 2011 [1 favorite]
Response by poster: but sometimes just thinking about doing the thing...
Absolutely and I thought about that just as I was posting.
Regarding some other comments as well; I am often shocked at finding a zero balance and have to pawn precious guitars for food/beer money and I haven't paid for a hair cut in about three years.
I didn't mention it in the question but another prob is that my wife is a teacher and when I get home from work I'm an artist, so I get clay and paint on her homework and she uses my Korg keyboard as a desk.
I'm spending the entire day today organizing our shared workspace and tomorrow, we hit the budget.
Thank you all for taking the time to help me get our heads wrapped around this!
posted by snsranch at 2:31 PM on November 12, 2011
Absolutely and I thought about that just as I was posting.
Regarding some other comments as well; I am often shocked at finding a zero balance and have to pawn precious guitars for food/beer money and I haven't paid for a hair cut in about three years.
I didn't mention it in the question but another prob is that my wife is a teacher and when I get home from work I'm an artist, so I get clay and paint on her homework and she uses my Korg keyboard as a desk.
I'm spending the entire day today organizing our shared workspace and tomorrow, we hit the budget.
Thank you all for taking the time to help me get our heads wrapped around this!
posted by snsranch at 2:31 PM on November 12, 2011
This thread is closed to new comments.
posted by headnsouth at 5:14 PM on November 10, 2011 [1 favorite]